The convergence of traditional finance and digital assets has entered a new phase, and Robinhood is positioning itself at the forefront. With a bold strategic pivot, the once-popular retail trading app is transforming into a full-fledged, crypto-native financial platform—aiming to become nothing less than the Nasdaq of the decentralized world.
In a high-profile announcement at Cannes, France, Robinhood unveiled a sweeping expansion of its crypto offerings, including tokenized U.S. stock trading, a proprietary Layer 2 blockchain, and crypto rewards via credit products. The news sent its stock soaring by 12.77%, marking a record high and signaling strong market confidence in its new direction.
This move places Robinhood in direct competition with both legacy financial platforms and native crypto exchanges now venturing into traditional assets—ushering in what many are calling the "bitstock era."
The Rise of Bitstock: Bridging Traditional Markets and Blockchain
Tokenized stocks—digital representations of real-world equities on a blockchain—are no longer theoretical. They represent a fundamental shift in how investors access and trade financial instruments.
Robinhood’s entry into this space is particularly significant because it combines mainstream accessibility with crypto innovation. Unlike earlier experiments in asset tokenization, Robinhood brings regulatory compliance, millions of active users, and deep integration with existing financial behavior.
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Robinhood vs. Kraken: Two Visions for Financial Convergence
While Robinhood pushes from the traditional finance (TradFi) side into crypto, Kraken represents the inverse trajectory—building crypto-native bridges to equity markets through its xStocks product.
Here’s how they compare:
- Blockchain Choice: Robinhood has chosen Arbitrum, an Ethereum Layer 2, for its tokenized stock infrastructure—prioritizing scalability, low fees, and alignment with the broader Ethereum ecosystem. Kraken’s xStocks runs on Solana, known for speed but with less regulatory clarity in Europe.
- Market Focus: Robinhood targets EU and EEA markets first, covering over 400 million people across 30 countries. Kraken’s xStocks currently excludes U.S. and EU residents, limiting its reach despite early technical advantages.
- Product Depth: Beyond tokenized stocks, Robinhood is rolling out perpetual futures contracts, staking for ETH and SOL, and an AI-powered investment assistant named Cortex. Kraken focuses primarily on spot trading of tokenized equities.
This rivalry isn’t just about technology—it reflects two competing philosophies: one rooted in regulated expansion, the other in decentralized disruption.
Robinhood’s Seven-Point Crypto Strategy
Robinhood didn’t just announce one feature—it launched a comprehensive ecosystem overhaul. Here are the seven key components of its new crypto strategy:
- Tokenized Stock Trading
Users can now trade blockchain-based versions of U.S. equities like Apple, Tesla, and Amazon—settled instantly with no market hours. - Arbitrum-Based Layer 2 Blockchain
A dedicated L2 chain will serve as the backbone for all tokenized assets, enabling fast, cheap transactions and cross-chain interoperability. - Crypto-Powered App Transformation in Europe
The European version of the app rebrands as a “crypto-first” investment platform, integrating tokens, derivatives, and fiat services under one roof. - Staking for ETH and SOL
U.S. users gain access to staking rewards directly within the app, increasing yield opportunities without leaving the platform. - Robinhood Gold Card with Crypto Cashback
The upgraded credit card offers automatic cashback conversion into popular cryptocurrencies—turning everyday spending into passive accumulation. - AI Investment Assistant “Cortex”
Leveraging machine learning, Cortex delivers personalized insights, real-time analytics, and risk assessments tailored to individual portfolios. - Advanced Tax Management Tools
Traders can now view holdings by tax lot and selectively sell assets to optimize capital gains—addressing one of crypto’s biggest pain points.
Together, these features form a cohesive vision: a seamless bridge between traditional investing and blockchain-native finance.
Why Is Robinhood Going All-In on Crypto?
This transformation isn’t sudden—it’s the result of years of strategic preparation and shifting market dynamics.
Strategic Acquisitions Pave the Way
In mid-2025, Robinhood made two major acquisitions:
- WonderFi (Canada): A regulated crypto platform with exchange and custodial infrastructure.
- Bitstamp: One of the oldest and most trusted crypto exchanges globally.
These purchases gave Robinhood instant regulatory credibility and technical depth—critical assets in navigating complex global markets.
Crypto Now Drives Profits
Financially, crypto has become Robinhood’s most lucrative segment. In Q1 2025:
- Total transaction revenue: $583 million
- Crypto revenue: $252 million (43%)
- Surpassing even options trading ($240 million)
More importantly, crypto orders generate significantly higher margins:
- Average rebate per order: ~0.35%
- Implied fee capture: 0.55%
- Market maker rebates: Up to 45x higher than stock trades
As analyst Di Zheng notes, “Crypto isn’t just profitable—it’s Robinhood’s highest-margin business by far.”
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The Bigger Picture: Rebuilding Finance on the Blockchain
Robinhood’s ambitions go far beyond trading. Its Layer 2 blockchain could eventually support:
- Tokenized bonds
- Derivatives and futures
- Real estate tokens
- Insurance policies
- Identity and credit scoring
If successful, this would accelerate the digitization of the entire $100+ trillion TradFi market—bringing transparency, efficiency, and global access to financial systems long burdened by legacy infrastructure.
In essence, Robinhood is betting that blockchain won’t replace Wall Street—it will absorb it.
Frequently Asked Questions (FAQ)
Q: What are tokenized stocks?
A: Tokenized stocks are digital representations of real company shares issued on a blockchain. They allow 24/7 trading, instant settlement, and fractional ownership—all while being backed by actual equity held off-chain.
Q: Is Robinhood launching its own cryptocurrency?
A: Not yet publicly confirmed. However, its development of a Layer 2 chain strongly suggests a native utility token may be introduced in the future for governance, staking, or gas fees.
Q: Can U.S. users trade tokenized stocks today?
A: Currently, tokenized stock trading is available only in the EU/EEA. U.S. availability depends on SEC regulations and may take time due to compliance hurdles.
Q: How does Arbitrum benefit Robinhood’s network?
A: By using Arbitrum’s Ethereum-compatible L2 solution, Robinhood gains low transaction costs, fast finality, strong security via Ethereum’s base layer, and access to decentralized applications (dApps) and DeFi protocols.
Q: Are tokenized stocks safe?
A: Safety depends on custody and regulatory oversight. Robinhood uses regulated custodians and complies with EU financial standards, making its offering among the most secure in the space.
Q: Will this compete with Coinbase or Binance?
A: Yes—but differently. While Coinbase focuses on compliance-first crypto expansion, and Binance on global reach, Robinhood competes by merging familiar stock trading with crypto innovation for mainstream users.
The era of isolated financial silos is ending. With Robinhood’s aggressive push into crypto infrastructure, we’re witnessing the birth of a new hybrid model—one where stocks, tokens, AI tools, and decentralized networks converge into a single investment experience.
Whether it becomes the true “Nasdaq of crypto” remains to be seen—but one thing is clear: the future of finance is on-chain.
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